Ex-Blagojevich adviser dies before prison term

September 13, 2009 5:02:52 AM PDT
A week before one of ex-Illinois Gov. Rod Blagojevich's closest advisers was to go to prison for fraud, the commercial roofing contractor died at a Chicago hospital, and the mayor of a town where he was found said the death was being investigated as a suicide. An autopsy was planned Sunday for Christopher G. Kelly, 51, who was discovered Friday night in a lumber yard parking lot in Country Club Hills, a town just southwest of Chicago. Kelly died Saturday morning, authorities said.

Country Club Hills Mayor Dwight Welch said police were investigating Kelly's death as a suicide, but were going to be especially thorough. Local and state police and the FBI searched for clues at the lumberyard, but no further information was available, Welch said.

Kelly -- who raised millions of dollars for Blagojevich's campaigns -- was taken to Oak Forest Hospital at 11:15 p.m. Friday, and later transferred to John H. Stroger Jr. Hospital for further treatment, said Stroger spokesman Marcel Bright. Kelly arrived there by ambulance at 5:15 a.m. Saturday and was pronounced dead at 10:46 a.m., Bright said.

Kelly had pleaded not guilty to charges included in the federal indictment alleging Blagojevich sought to sell or trade President Barack Obama's former U.S. Senate seat.

But he was to report Friday to begin serving a three-year federal prison sentence after pleading guilty to tax fraud charges that included writing off thousands of dollars in gambling debts as business expenses.

Kelly, who admittedly loved to gamble and ran up big debts at Las Vegas casinos and elsewhere, was part of Blagojevich's tight inner circle along with convicted influence peddler Tony Rezko. Rezko is believed to be cooperating with federal prosecutors after being convicted of taking part in a $7 million payoff scheme.

Kelly also pleaded guilty Tuesday to taking part in an $8.5 million fraud against United Airlines and American Airlines for work on their hangars at O'Hare International Airport. A plea agreement with federal prosecutors called for him to serve a five-year prison sentence on top of the three years for tax offenses.

He also faced charges in the sweeping Blagojevich indictment that alleged he plotted with Blagojevich to use the muscle of the governor's office to squeeze payments out of those seeking state business.

Prosecutors hoped Kelly would try to reduce his mounting federal prison time by agreeing to cooperate and tell them what he knew about corruption in state government under Blagojevich.

But he remained grimly silent as his situation got worse.

Kelly's chief defense attorney was not available for comment, according to a woman who answered the telephone at his home. A spokesman for the U.S. attorney's office, Randall Samborn, declined to comment.

Blagojevich was in New York when he learned of Kelly's death. "I am deeply saddened to hear that Chris has died. My heart goes out to his wife Carmen, his three daughters Grace, Jacqueline and Claire and his entire family. They are in our prayers," Blagojevich said in a statement.

Neither of Kelly's guilty pleas called for any cooperation with the government.

"I rather doubt that it will have any impact on the government's case at all," said Allan A. Ackerman, who recently joined Blagojevich's legal defense team. "It's a tragedy and very sad for his family."

On Tuesday, Kelly admitted he paid $450,000 in kickbacks to an unnamed consultant who allegedly inflated cost estimates for repairs to hangars at O'Hare. Kelly admitted bids on the projects were rigged to make certain his BCI Commercial Roofing Inc. would land the contracts.

In all, the contracts paid Kelly $8.5 million. His profit was $2.5 million, according to the plea agreement. He was to be sentenced to nearly five years in prison.

U.S. District Judge Charles R. Norgle set Nov. 18 for that sentencing but ordered Kelly to start serving time next Friday.

The new sentence would have been on top of those three years, handed to him in June for obstructing the Internal Revenue Service by paying gambling debts with his company's money and illegally structured cash withdrawals to hide how much he was taking from the company.

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